In what could be the largest outbound pharma deal by an Indian company, Aurobindo Pharma Ltd and Intas Pharmaceuticals Ltd are in the race to acquire part of the European assets of Israeli generic drugmaker Teva Pharmaceutical Industries Ltd.
The largest so far is Lupin Ltd’s acquisition of Gavis Pharmaceuticals Llc. and Novel Laboratories Inc. for $880 million in 2015.
In 2015-16, Intas Pharma earned close to $1 billion in revenue with a profit after tax of $130 million. Aurobindo Pharma posted sales of Rs15,090 crore and returned a net profit of Rs2,296 crore in the year.
Now, both the companies are in talks with banks to tie up funding for the final bids. Several other international companies and private equity funds are also expected to participate in the bidding process. Intas’s bid is likely to be in the range of $1 billion or slightly higher and the acquisition will be completely funded by debt.
The assets that are part of the deal include the oncology, pain management and women’s health divisions of Teva Pharma. Additionally, the process being managed by Morgan Stanley and Bank of America Merrill Lynch (BAML), is expected to receive bids that are upwards of $ 1 billion.
This will be the second time in less than a year that Aurobindo and Intas are vying for Teva’s assets. Just last year Aurobindo unsuccessfully bid for Teva’s Actavis UK Ltd and Actavis Ireland Ltd units and was pipped at the post by Intas, which paid close to £600 million (around Rs5,000 crore) to win the deal.
The transaction was part of the European Commission’s antitrust divestiture requirement arising from Teva’s acquisition of Actavis. In July last year, Cipla Ltd, India’s fifth largest drug maker, acquired a portfolio of three products from Teva in the US. In November last year, Aurobindo Pharma acquired a few products from Teva in France.
